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Modi magic continues to work its spell over India

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Supporters of the Bharatiya Janata Party (BJP) react after India's Prime Minister Narendra Modi's roadshow in Ayodhya, India, 30 December 2023 (Photo: Reuters/Anushree Fadnavis).


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On the face of it, India appears to be in something of a sweet spot. Last year the nation became the world’s most populous country; Prime Minister Narendra Modi hosted world leaders at the G20 Summit while being treated to large and enthusiastic receptions abroad; and India enjoyed the fastest growth of any major economy in the world.

Sweet spots have a habit of becoming intoxicating — but take a peek under the hood and things may not smell quite so rosy. The Hindutva ideology espoused by the ruling Bharatiya Janata Party (BJP) has propelled it to electoral success in the Hindi Belt, but the party has made fewer inroads in the southern states. The geopolitical honeymoon with the West has cooled. And India’s economic ambitions are still, for now, more smoke than fire.

Yet with general elections fast approaching, ‘2024 could be an epoch-making year’ for Modi and the BJP, writes Robin Jeffrey in this week’s lead article. Modi is hoping to guide his party to power for a third successive term — if successful, he would be the first Indian prime minister to achieve this feat since Jawaharlal Nehru.

The BJP has reason to be optimistic. In state elections, they ‘received a boost of confidence in early December after landslide victories in three Hindi-speaking northern states’. Though it’s true, as Jeffrey points out, that ‘state-level success doesn’t necessarily translate into national victories’, ‘the common ingredient in the BJP’s state campaigns will loom even larger in the national elections’. Prime Minister Modi, a master in the art of taking credit, is one of the world’s two most popular elected politicians, alongside Indonesian president Joko Widodo, with approval ratings soaring above 70 per cent.

Jeffrey points out that ‘the most prominent items on the BJP’s third-term agenda will be cultural’, as India will be ‘imbued with the BJP-RSS version of what it is to be a Hindu’. Four months out from the election, the politics of Hindutva is on clear display. This week, Modi will consecrate the Ram Mandir — a Hindu temple built at the supposed birthplace of the deity Rama and a source of deep tension between competing Hindu and Muslim claims to the site.

There are signs that Modi’s hard-knuckled approach to domestic politics is bleeding into India’s dealings with foreign-based political enemies. After Modi’s rapturous receptions in Australia and the United States last year, India’s geopolitical shine has worn thin in the West following Canada’s accusation of the Indian government’s involvement in the murder of a Sikh Canadian associated with the Khalistan separatist movement, and the investigation of a similar plot in the United States.

Jeffrey notes that Canada’s Western allies have been cautious in their criticism, ‘not wanting to disturb the development of the Quad’. But the episode serves as a clear reminder that India will follow its own interests, which may not easily align with a simple ‘democracies vs autocracies’ view of the world — strategic convergence should not create false expectations of a deeper partnership based on shared political values.

India’s geopolitical clout will nonetheless continue to grow as its economy does. Modi has promised to make India the world’s third largest economy in his third term. By the country’s sheer weight of numbers and recent performance, this promise seems credible. But it’s a modest ambition given the country’s population base. He has overseen relatively strong growth in his two terms so far and his digitalisation drive has made welfare and banking payments more accessible than ever, with NITI Aayog, an official think tank, estimating a decline in ‘multidimensional’ poverty from 29.17 percent in 2013-14 to 11.28 per cent in 2022-23. But as is often the case with India, the study is limited by a lack of data, raising questions about some of its estimates.

The prime minister’s other big ambition — for India to become a developed country by 2047 — is more difficult to achieve. That would require growth of at least 7.6 per cent per year for the next 25 years. As Jeffrey points out, ‘[a] third term for the BJP is unlikely to bring major economic change’. Having experienced a rare political defeat at the hands of a mass protest movement against its proposed liberalisation of agricultural markets in 2020–21, the government will tread cautiously on agrarian reform in a third term.

The Modi government is meanwhile likely to maintain its current ‘Make in India’ initiative that aims to build self-sufficiency by promoting domestic manufacturing and reducing imports in selected sectors. But there are problems with this industrial development plan. The sectors chosen for the government’s production-linked incentives, such as electronics, automobiles and medical devices, are primarily capital-intensive. They create few jobs, and those that are created are not well suited for India’s population where education levels are low and ‘a significant proportion of under-employed young people lack basic skills’. The government’s focus on high-tech goods and services has led to jobless growth, with the economy failing to provide enough opportunities for the fast-growing population, resulting in unemployment and the under-utilisation of India’s large labour force.

Without a retuning of its growth strategy so that it’s centred on creating opportunities for its large pool of unskilled labour, India risks wasting its demographic dividend and perpetuating poverty.

The opposition and their Indian National Developmental Inclusive Alliance (INDIA) coalition are yet to provide a unifying policy agenda that goes beyond their shared hostility to the BJP. Without a compelling rival, Modi magic looks set to return for another term.

The EAF Editorial Board is located in the Crawford School of Public Policy, College of Asia and the Pacific, The Australian National University.

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